A Window of Opportunity for Exponential Growth
EXIT Realty’s Tami Bonnell builds on human potential.
For Tami Bonnell, CEO of EXIT Realty, everything in real estate is about opportunity.
“Everything we do at EXIT is about helping regional owners, broker-owners and associates have more control of their businesses, their investing and their lives,” she said.
We mentor our agents along the path to investing and so many of them choose to work with EXIT because of the opportunities the organization represents. She noted that EXIT is built on human potential and considers it her “job” to support EXIT’s real estate professionals and help agents optimize their growth and productivity.
“At EXIT Realty, the opportunities are truly limitless. There are opportunities for true entrepreneurs to have regional ownership (owning the rights to a state or province), own their own brokerage, become an EXIT associate and invest by working with our real estate professionals,” she said.
When Bonnell refers to “EXIT,” she means EXIT Realty Corp. International, a full-service real estate franchisor that originally opened for business in Toronto, Canada, before expanding across North America.
EXIT operates on its unique “EXIT Formula,” often referred to as “Real Estate Re-Invented.” The company not only offers intense and highly customized support for all associated agents and professionals, it also rewards those individuals for bringing other successful agents into the business by providing “residuals” (short for residual income) to its agents and their beneficiaries throughout their professional careers, into retirement and even after death.
“Every person who is introduced into the company is, obviously, introduced by another associate in the company. That associate will receive the equivalent of 10% of the gross commissions earned by the agent or agents they introduced into the company for as long as the associate continues with EXIT,” Bonnell said.
The program permits up to $10,000 per sponsor per year and continues into “retirement,” which occurs when the introducing associate’s activity falls below eight transactions per year. At that point, the retired individual receives 7% residuals with their brokerage receiving the other 3%.
“We have helped support our regional owners, broker-owners and associates through caring for an ill parent, an illness in their family, and even knee and hip replacements,” Bonnell said. “That residual income gives them flexibility when they need it and a ‘Plan B’ for retirement that does not require them to keep working in real estate for the rest of their lives.”
Bonnell noted the com- pany’s residuals may even be inherited; beneficiaries receive 5% after the death of the agent while the brokerage receives the other 5%.
“We have already paid out over $460 million in residual income to our people,” she said. “That steady, ongoing income and support has had a huge impact on our agents, but there is so much more to this company.”
Serving as a Trusted Advisor
Bonnell identified EXIT Realty as a company she wanted to be associated with long before the real estate corporation made major headlines in the U.S. “I’ve been instrumental in building three major brands prior to EXIT,” she said. “I actually came looking for EXIT and bought the rights to the New England states in 1999.”
By 2000, Bonnell was vice president over the U.S. organization at the company. By 2001, she was president. In 2012, when she received the title of CEO, Bonnell pledged to not only build up the company but also to stick with the core values of human potential and putting people first that EXIT initiated from the very beginning.
“Sixty-four percent of the population believes companies should do this, and I’m dedicated to that goal,” she said. “It has been shown time and time again, if you put people before profits, you will make more profits.”
To that end, Bonnell has spearheaded EXIT endeavors that improve the real estate businesses of its associates so they can grow upward and outward in directions best suited to their specific needs. For example, EXIT was the first company to join the REI Referral Network, a partner organization with REI INK magazine, that was launched to provide a platform for real estate practitioners—agents and brokers—to connect with real estate investors.
EXIT’s efforts often revolve around educating associates to read market signals, communicating effectively with different types of buyers and sellers with very different types of goals, and leveraging their specific personality traits and strengths toward the growth of their businesses.
“We offer our agents a vast array of tools and resources to help them identify and leverage their strengths,” said Bonnell, who sold her first house when she was 13. “I sold on-site for builders until I was old enough to get my real estate license, but what I really fell in love with in this industry was the ‘back room.’ I found the average person who owns a real estate business did not really know what they had or the true value of their company and the depth of their own skills. I wanted to change that and support those people. That is my passion.”
Bonnell’s philosophy of investing in people was a perfect fit with EXIT’s dedication to equipping its agents with the tools to become what Bonnell refers to as “trusted advisors” for their clients and colleagues.
“The human element is what led us to initially invest in real estate investors and real estate professionals,” she said. “We want our agents and professionals working closely with clients who are a good match for their skills. We help them do their homework on the human behind the transaction they are facilitating for two reasons: It is the best way to help that human, and it is also the best way to transact the best sales.”
Bonnell, who has broken plenty of sales records herself, added, “It’s about making things personal, putting yourself in your client’s shoes and understanding their wants and needs. We live in a high-tech world, but consumers still want trusted advisors who understand them and who also offer the speed and transparency that come with good use of technology.”
To help achieve that combination, EXIT’s chief technology officer, John Packes, and EXIT’s director of innovation, John Lim, designed a mobile business card technology intended to optimize response times and enable agents and clients to get near-immediate reactions to queries and interest in a property.
“They (Packes and Lim) have more than 72 active patents,” Bonnell said. “They created these mobile business cards to help agents achieve better control of their businesses and generate more leads. It makes things easy and convenient for clients, but it also generates leads and information for the agent.”
Packes and Lim also created Smart Sign technology for EXIT Realty signs on front lawns so that every potential buyer can access all the listing information on any given property immediately via texting a simple code, and an app, called the EXIT Realty Connect App, which links EXIT Realty clients and associates anywhere in the country.
“That instant access and coordination with EXIT associates gives buyers and EXIT associates more power and control than almost any other technology. In the first 90 days of launching the Smart Sign technology, we created more than 89,000 leads for our associates,” Bonnell said, noting that today most people don’t want to engage with a real estate professional until they are ready to take action but that when they do reach that point, they want that instant gratification.
Building For the Future
Bonnell emphasized her role with EXIT Realty is to help the company grow from multiple angles. Certainly she is dedicated to building up the company’s associates so they can experience the greatest possible success and rewards in real estate. In addition, like the rest of the EXIT team, she is dedicated to identifying new ways the company can “make the world better.” She is also dedicated to identifying the next great regional leaders around the country, to getting new franchises across North America and to helping every EXIT associate grow. This starts with making every single EXIT transaction a source of community betterment.
“Money from every transaction our associates do goes back into the community we serve,” Bonnell said. “For example, we have pledged more than $5.5 million to date to charity. We recently refined our program to create the Spirit of EXIT, wherein agents or brokers do their own fundraisers via a dollar-for- dollar matching program.”
Through Spirit of EXIT, the company empowers its real estate professionals to become involved in their local communities at a grassroots level in a way that immediately doubles the impact of their local efforts. “We found that this enables us to touch exponentially more communities and charities while creating an office culture that is enmeshed in the community,” Bonnell explained.
“We have a lot of people who have started their own charities based on the greatest needs in their communities. This makes them (and EXIT) good corporate citizens,” Bonnell said. However, the concept of “good corporate citizenry” extends beyond simply donating money to local organizations in need. EXIT views its role in the equation as one that demands intense loyalty and sacrifice on the part of the leadership team on occasion.
“We decided early on that part of who we are as a company involves valuing our own human beings as well as giving to others,” Bonnell said. “During the last recession, most major brands were doing what I call ‘laying off numbers,’ meaning they were just trying to cut as many jobs as possible to keep the company afloat. We decided we would take a different approach and, instead, out-think and outsell the recession. We did not lay anyone off. The only people who took a hit in pay were those in leadership, and we did it because we believed we needed to demonstrate to our people that they were that important to us.”
EXIT emerged from the recession intact with loyalty and respect from associates, brokers and regional owners that Bonnell said firmly no one could ever put a price on.
“The caliber of the people involved with us today is incredible, and that is good for profits as well as for making everyone’s lives better,” she said. “From a leadership standpoint, we invested in our people so that they would become everything we know real estate professionals can be.”
Case Study: From Fix-and-Flip Dreams to Condo Rental Reality
Tami Bonnell sees a lot in her role as CEO of EXIT Realty, and she tends to get very “up close and personal” with the real estate professionals fortunate enough to enter her orbit. When that happens, the full focus of the longtime CEO falls on that real estate investor or agent—and good things start to happen.
“Ninety percent of consumers want a trusted advisor, and that applies to real estate professionals as well as homebuyers and sellers,” Bonnell said. “They want someone to help them understand the data we are all drowning in. They want answers to questions like, ‘How does this apply to me or my clients?’ and ‘What is going to happen next?’”
Bonnell’s response to this basic need for both information and reliable interpretive processes for data is to offer access to her own knowledge and expertise. She speaks in hundreds of markets around the country each year, working with industry leaders and real estate professionals on behalf of EXIT associates to evaluate local market opportunities and potential pitfalls.
“I speak on where the windows of opportunity are, what the potential is and how to leverage those opportunities,” she said.
Bonnell said the biggest mistake she sees real estate professionals make is not planning.
“You should be asking yourself, ‘Do I want consistent cash flow?’ or ‘Am I planning to put my kids or grandkids through school?’ or ‘Is my real goal freedom and flexibility so I never have to work again?’” she said. “If you fail to ask and answer questions like these, you will not be able to see your beginning or your end. You will probably struggle to get anywhere at all.”
Bonnell recounted a story about an investor she worked with whose goal was to flip houses. “Unfortunately, she was never going to fix-and-flip successfully,” Bonnell recalled. “She does not even like to do her own laundry. She was just too hands-off for it to work.”
Bonnell worked with the investor to carefully evaluate her goals and identify strategies that would work for her strengths and in her locale. “She wanted to invest in the town where she lives, which is much like most investors. Even if you know you can invest elsewhere, the truth is most people prefer to invest close to home and will be more successful if they do so because they will be more comfortable. However, you have to find the right strategy for your local area if you are determined to invest there,” she said.
In this case, the investor in question worked with Bonnell to research her area and discovered about half of the population in the area is divorced. Additionally, the area has some of the best public schools in the state.
“Every time someone gets divorced in this area and their income splits in half, they end up renting condos in the community because they want to keep their kids in the local schools,” Bonnell said. “They stay until their kids turn 18 and finish school, so if you rent condos to these residents, you get a great tenant and you can also generate significant cash flow on those rentals.”
The investor in question thrived using this strategy. As a single mother herself, she had great empathy for the single parents renting from her. She also enjoyed the predictability of the investment, which she would not have had in a fix-and-flip business. Best of all, Bonnell said, “She will have a ton of equity as time goes on. For her, this option worked far better than her initial idea that she got from watching a fix-and-flip show on television. We just had to find what made the most sense and she was positioned for success.”
Sidebar: Operating With an Investor’s Edge
“Real estate investors account for about 25% of real estate business all the time, and they account for more of it during a downturn,” Bonnell said. “Investors succeed with EXIT because they, like us, are all about identifying opportunities.”
She noted many EXIT agents and brokers are able to identify opportunities for both themselves and their clients that more conventionally trained and supported real estate professionals would likely miss.
“Investors tend to be among the best in the business when it comes to understanding how to build a future using real estate and how to have a lot of flexibility and choices with their investments,” she added. “Our brokers and agents often buy investment properties of their own because they see the power in the combination of the residual income component of working with EXIT and the cash flow and equity facets of owning investment properties.”
Exit Realty: By the Numbers
460+
Combined years of real estate experience on the company’s 18-member executive team
0
Number of boards of directors to whom EXIT answers
“”
We are a privately held company with a foundation of people first. We do not answer to shareholders nor to the whims of a here-today-gone-tomorrow figurehead.*
15
Average number of years each executive team member has been with EXIT Realty
$5.5M
Amount pledged to date by EXIT Realty Corp. International to charity
20
Number of Habitat for Humanity home builds EXIT has formally sponsored to date
10
The equivalent of 10% of the gross commissions earned by each person sponsored by an EXIT associate that the sponsoring associate will earn
“”
Note that these residuals are not deducted from the recruit but paid to the sponsor via EXIT’s head office.*
7
Percentage to which sponsoring bonus payouts convert when a sponsoring associate takes a break from real estate or retires (closes fewer than 8 transactions in a year).
“”
We see many EXIT associates in ‘retirement’ or ‘on sabbatical’ continue to supplement their income by sponsoring people into EXIT.*
5
Percentage to which sponsoring bonus payouts convert when an associate dies and their residuals are passed on to a pre-determined beneficiary
“”
Not only is EXIT’s Formula perpetual, but it is also portable.*
*All “By the Numbers” quotes attributed to EXIT CEO Tami Bonnell
